The effects of social class, education levels on ability to work from home during COVID-19

Survey results from Pew Research show that whether American workers work from home amid the COVID-19 pandemic is affected by social class and education:

Four-in-ten working-age adults – those ages 18 to 64 – say they have worked from home as a result of the coronavirus outbreak. Men and women in this age group are about equally likely to say they have worked from home.

About three-quarters of working-age adults with a postgraduate degree (73%) say they have worked from home as a result of the coronavirus outbreak, as do 62% of those with a bachelor’s degree. Far smaller shares of working-age adults with some college (35%) or with a high school diploma or less education (22%) say they have worked from home.

Similarly, working-age adults with higher incomes are more likely than those with lower incomes to say they have worked from home because of the coronavirus outbreak: 61% of those in the upper-income tier say they have done this, compared with 41% in the middle-income tier and an even smaller share (27%) of those with lower incomes.

In states with a high number of coronavirus cases, 45% of working-age adults say they have worked from home because of the outbreak; smaller shares in states with a medium or low number of cases say the same (38% each).

The knowledge economy is up and running. Those with more education and income have jobs and workplaces that can be done from home and other locations. This could have to do with the kind of work being done and the resources the organizations and/or workers have. The dividing line of a bachelor’s degree or higher does not just affect future earnings; it can affect exposure to particular diseases.

On the other hand, workers with less education and lower incomes are less able to work at home. This could put them in settings with more contact with others and present a tough decision between keeping a job and wanting to stay healthy. The reactions of workers in numerous facilities and companies suggests this is indeed a real issue. The dividing line of a bachelor’s degree or higher does not just affect future earnings or opportunities; it can affect exposure to particular social conditions.

In the longer run, I would guess there will be plenty of future research on the effects of COVID-19 by social class. Whether facing a pandemic or not, working from home is a luxury for those who have particular social statuses. Since the American economy is a long ways from making all or even most jobs doable from a distance (and there are likely other important considerations regarding this), this will continue to be an important matter.

The backup offices for businesses and organizations to weather crises, disasters

Maintaining essential operations for a business or organization might be easier if they have a “ghost office” available:

Terrorist attacks. Natural disasters. And yes, pandemics. These are just a few of the events that might cause a company to abruptly ditch their usual building and relocate staff to a backup office – also known as a “disaster recovery” or “business continuity” site…

Not all businesses can afford to have these dedicated facilities at their disposal, but backup offices can prove crucial to the survival and safety of certain companies whenever crisis hits. Often, disruptive situations only last a few days or weeks. But with coronavirus potentially lasting well into 2021, firms may find themselves relying on backup offices much longer than ever before…

By spreading workforces across a greater number of sites, businesses are clearly hoping that they can mitigate some of the risk presented by Covid-19, the disease caused by the new coronavirus. But some observers say working from home is better than opening up more offices, since any shared workplace could become a hotbed for virus transmission. Morley says Sungard’s clients are indeed thinking about hygiene. “Customers have actually said, ‘Look, before we come in can you do a deep clean?’” he explains…

Such backup offices are termed “hot sites” in the industry because they can be used immediately and don’t need to be kitted out or “warmed up” first. “Cold” sites, by contrast, could be as simple as an empty warehouse to which equipment can be shipped during a crisis.

Even if the majority of the workforce could work from home, how many organizations can move everything out of the office or online? The article presents such locations as a luxury – maintaining sites for long periods without using them could be very costly – but it is hard to imagine that many organizations or businesses can work fully off-site. There might be access to vital equipment (servers? files? machines?) as well as a desire for important personnel to gather and make decisions. At the least, I imagine many organizations have and/or will reconsider disaster/crisis plans.

The article hints at this and I am not sure how physical spaces could help much here: a pandemic crisis is much different than a natural disaster. With nature interfering with business, the needs might be to have electricity, Internet, access to workers and clients spread out over distances. Putting people in a centralized backup office makes a lot of sense for this. On the other hand, a pandemic means that a centralized location might be even worse for maintaining operations. The actual physical office space becomes less valuable or helpful in some disasters compared to others. Will some companies move to having separate safe offices for pandemics and natural disasters? Or, will the popularity of these sites decrease as organizations focus more on equipping individual employees and arms of the organizations to work from remote locations if needed?

The advantages McMansions may offer for working from home

With coronavirus pushing more people to work from home, I have seen more advice about setting up a home workspace. I found one example that suggests workers in all kinds of homes face similar challenges:

First things first: As we’re learning, there’s no “normal” with the coronavirus. But that also applies to where you live. “Home workers” now include apartment dwellers, Millennials who share a house, Midwesterners with basements, suburbanites in McMansions, and more. You’ll have to figure out what works for you, within your own unique environment. Still, some rules apply to just about everyone.

Is this true? Do McMansion-dwellers have any advantages in working out of their large homes? A few ideas:

  1. All that space means McMansion occupants have plenty of options to choose from regarding where to work. They could even rotate (though these articles tend to emphasize making one space a clearly delineated work space).
  2. All that space also means they can keep their distance from all other occupants.
  3. Although the McMansion might have a lot of open common space, there are likely parts of the house that can be pretty quiet and separate from other activities.
  4. Related to #1-3, who likes open office plans?
  5. If a worker needs to bring lots of materials home, the McMansion likely has a lot of storage space. A temporary home office might barely be noticed.
  6. Because of the size of the home, the walk from the office space to the kitchen or bathroom could be a sufficient break or help the worker acquire their needed steps.
  7. The McMansion home worker pressed for cash could rent out a room or create a coworking space (while attending to local zoning codes, of course).
  8. There could be enough space to recreate the spaces in a large office building, ranging from a workout room to a large eating area to spacious bathroom to room to spread out one’s work.

Americans like their private spaces but being confined to one’s home for a few weeks may just reinforce the desire of some to have plenty of space.

5G over what percent of America? T-Mobile: covering over 5,000 cities and towns, 200 million Americans

T-Mobile is running a commercial touting their new 5G network. They claim it reaches 200 million Americans and over 5,000 cities and towns. What if we put those numbers in context?

On one hand, both figures sound impressive. Two hundred million people is a lot of people. This is a lot of text messages to send, TV shows and videos to stream, and social media and web pages to visit. This is a potential large market for T-Mobile. And 5,000 cities and towns sounds like a lot. I don’t know how many places Americans could name but many would probably struggle to name 5,000.

On the other hand, the figures suggest that the 5G coverage still does not reach a good portion of Americans or certain parts of the country. According to the Census Population Clock, the US population is over 329 million. So covering 200 million people comes to roughly 61% of Americans covered. This more than half, not quite two-thirds. Additionally, 5,000 cities and towns sounds like a lot. Some older data – 2007 – suggests the United States has over 19,000 municipal governments and the Census in 2012 also counted over 19,000. With these figures, 5G from T-Mobile covers a little more than one quarter of American communities.

Perhaps T-Mobile is doing the best the can with the coverage they have. The numbers are big ones and I would guess they could catch the attention of viewers. Maybe the numbers do not matter if they are trying to be first. However, just because the numbers are large does not necessarily mean the product is great. Significant segments of Americans will not have access, even with the big numbers. The numbers look good but they not be as good for some when they look into what they mean.

Amazon wanted a really big tax break with HQ2

When Amazon went on a search for a second headquarters, it was motivated in part by looking for a big tax break:

When Elon Musk secured $1.3 billion from Nevada in 2014 to open a gigantic battery plant, Jeff Bezos noticed. In meetings, the Amazon.com Inc. chief expressed envy for how Musk had pitted five Western states against one another in a bidding war for thousands of manufacturing jobs; he wondered why Amazon was okay with accepting comparatively trifling incentives. It was a theme Bezos returned to often, according to four people privy to his thinking. Then in 2017, an Amazon executive sent around a congratulatory email lauding his team for landing $40 million in government incentives to build a $1.5 billion air hub near Cincinnati. The paltry sum irked Bezos, the people say, and made him even more determined to try something new.

And so, when Amazon launched a bakeoff for a second headquarters in September 2017, the company made plain that it was looking for government handouts in exchange for a pledge to invest $5 billion and hire 50,000 people. The splashy reality-television-style contest generated breathless media coverage, attracted fawning bids from 238 cities across North America and ended with Amazon deciding to split the so-called HQ2 between New York and Virginia. Then progressive politicians attacked the $3 billion in incentives offered by New York, and Bezos pulled out. Amazon was widely ridiculed for its failure to court New York politicians. To understand why that happened, Bloomberg interviewed 12 people familiar with Amazon’s effort. Their story, outlined here for the first time, depicts a team that became the victim of its own hubris. Bezos’s frustration with what he deemed meager government largess prompted executives to scrap lessons learned through the years in favor of an unapologetic appeal for tax breaks and other incentives.

This news came just as we finished introducing the concept of growth machines in my urban sociology class. In this theory, coalitions of political and business leaders drive development decisions with profits and growth in mind. In this particular case, Amazon looked to cut a deal with the city that was willing to give them the most. If Amazon chose their city, political and business leaders could claim they won because of all the new jobs plus the prestige of an Amazon headquarters while Amazon would profit from massive tax breaks. As I noted then, let the race to the bottom begin.

The biggest problem with all of this is not that there is competition between locations for headquarters and business activity. This has gone on for a long time and for a variety of organizations; read about the bids to land the United Nations headquarters. The issue is that the large tax breaks mean that some of the benefits of a business moving to a community are offset by tax breaks. And who benefits more in the end? The corporate leaders, not the community as a whole.

I can imagine a television game show format with all of this: a corporation says they want to expand and help a community or region along the way. Bidders/communities bring their pitch to the show, showcasing the best of their community (and the money). The corporation narrows it down and in the end names the one winner. Everyone else loses out (outside of making a public pitch regarding the best aspects of their community). It could be very entertaining.

Can Starbucks be a third place when its drive-through is so full?

Starbucks aspires to be a third place, a setting where people of different backgrounds can gather in between home and work. Coffee shops, and restaurants more broadly, can play this role as people need to eat and drink and such activity is often tied to social interaction.

In my morning commute, I pass a Starbucks in front of a strip mall and right next to a busy suburban road. The drive-through line is always very full. The size of the line is particularly noticeable in this location because once the Starbucks line has more than eight cars, it spills over into the roadway through the shopping center and can block traffic.

The inside of this location is attractive. A month ago, I spent a morning working there. The store had dark walls and what looked like a tin ceiling plus a variety of seating options (tables, upholstered chairs, work counters). A steady flow of people came in and out and there were at least a few others like me hunkered down for several hours doing work. From my working location inside, all morning I could see the steady flow of people going through the drive-through.

Can a coffee shop or any restaurant so dependent on drive-through traffic for business (think McDonald’s) truly be a gathering spot, a social space, a third place? Perhaps the issue is much bigger than Starbucks:

1. Businesses do need to make money. Starbucks has encountered this problem before with people and visitors who might restrict or limit sales. Not having a drive-through is a bold statement but might not be financially viable (or might not generate the kind of revenue Starbucks desires).

2. The suburbs require driving (and many Americans seem to like it this way). Starbucks locations in denser settings do not have drive-throughs and perhaps they can better function as third places.

3. American fast food combines the ability to drive and getting food quickly. Without a drive-through, Starbucks is both missing out on business and putting itself into a different category of place.

4. Americans in general may not like third places given their preferences for single-family homes and private dwellings alongside their devotion to work. Any business or restaurant trying to fight against this may not make much progress. Even if people come to Starbucks or similar locations, how many engage with the people around them as opposed to focusing on their own work or interacting with a companion who came with them or who met they there? Public spaces where people come together are rare.

Maybe Starbucks can only be a third place in a certain kind of location with denser populations and less reliance on cars. Or, perhaps Starbucks can never really be a third place in a society dominated by driving and quick food.

Starbucks as a symbol of wealth in a community

Starbucks is planning more stores in less wealthy neighborhoods:

Starbucks plans to open or remodel 85 stores by 2025 in rural and urban communities across the U.S. Each store will hire local staff, including construction crews and artists, and will have community event spaces. The company will also work with local United Way chapters to develop programs at each shop, such as youth job training classes and mentoring…

Starbucks opened its first community store in Ferguson, Missouri, in 2016, two years after the riots that broke out over the shooting of an unarmed black 18-year-old by a white police officer. It has added 13 more locations since then, including stores in Baltimore, Chicago, Dallas, New Orleans and Jonesboro, Georgia. Another one will open this spring in Prince George’s County, Maryland. Starbucks estimates the shops have created more than 300 jobs…

Kelly said the stores reflect Starbucks’ core belief in responsible capitalism. The coffee shops are profitable, he said, and have the same menu as regular Starbucks stores…

“I can’t think either of a retailer, especially one that has more of a discretionary, higher-end purchase, being willing to push into neighborhoods and markets that have less purchasing power,” Theodos said. “Starbucks usually appears when a neighborhood has the purchasing power to support it.”

For years, Starbucks has been a brand and presence that signals a wealthier location. With their prices, products, and aesthetics, communities had to have a certain level of resources for Starbucks to locate there. Once the money was there, Starbucks might arrive in droves. (I’m thinking of the number of Starbucks on Michigan Avenue in Chicago.) If payday loan stores and dollar stores help identify poorer locations, Starbucks may be the most common restaurant that signals the opposite.

I am curious about one item of information from the article. The Starbucks executive quoted in the story says the locations are profitable. Does this mean Starbucks avoided these locations for so long even though they could have made money or did something change in the cost equation over time? Some firms would want to expand everywhere to bring in money though others might want to protect their status.